Order 2011-6-19

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

On the Seventeenth day of June, 2011

Cameron Air Services, Inc. Docket OST 2011-0003

Served June 17, 2011

Violations of 49 U.S.C. §§ 41703 and 41712 and 

14 CFR 294.81 

CONSENT ORDER

This order concerns unauthorized passenger air service between two cities in the United

States by Cameron Air Service, Inc., (Cameron) a Canadian charter air taxi registered 

with the Department pursuant to 14 CFR Part 294, that violates 49 U.S.C. 

§§ 41703 and 41712 and 14 CFR Part 294. It directs Cameron to cease and desist from 

future violations of Part 294 and sections 41703 and 41712, and assesses the carrier a

compromise civil penalty of $20,000. 

Applicable Law

The carriage of local traffic for compensation or hire by foreign air carriers, including 

Canadian charter air taxis, between two points in the United States, a practice commonly 

referred to as cabotage, is a violation of 49 U.S.C. § 41703, which prohibits cabotage 

except under very limited circumstances that do not apply here. Registered Canadian 

charter air taxis that engage in cabotage without Departmental authorization also violate 

14 CFR 294.81, which applies the general statutory prohibition in section 41703 

specifically to them as a class of foreign air carrier. Violations of section 41703 and Part 

294 also constitute an unfair and deceptive trade practice and unfair method of

competition in violation of 49 U.S.C. § 41712. 
2

Facts and Conclusions

The violations that are the subject of this order occurred on January 16, 2011, when a 

Cameron-operated Cessna C-208 transported two passengers for compensation or hire 

from Teterboro, New Jersey (TEB), to Boston, Massachusetts, (BOS). 

On January 16, 2011, the Cameron C-208 aircraft entered the United States at TEB from

Toronto City Airport, Canada, (YTZ) carrying two passengers. At TEB, two additional

passengers boarded the aircraft and accompanied the party to BOS. In BOS, the two 

passengers originating at TEB discontinued their journey, and the two Torontooriginating passengers returned to Toronto, Canada, (YYZ). The flights were performed 

pursuant to a single-entity charter1 agreement between Cameron and one of the Torontooriginating passengers. 

It is a violation of 49 U.S.C. § 41703 for a foreign civil aircraft to transport passengers 

or cargo solely between two points in the United States for compensation or hire, even if 

the aircraft is being operated pursuant to a single entity charter that, in other respects, 

begins or ends outside the United States.

2 Thus, for purposes of 49 U.S.C. § 41703, 

where a single-entity charter involves the operation of a foreign aircraft in U.S. airspace, 

as in this case, the journey of each passenger carried on the chartered aircraft, rather than 

the entire itinerary paid for by the charterer, is considered a separate act of providing air 

transportation for compensation or hire. If the journey of any individual on such a 

charter is entirely between two U.S. points, then the carriage of that passenger 

constitutes cabotage.

In this instance, the charterer contracted in Canada for air transportation for his son and 

his friends. The resulting movements involved four passengers to, from, or between 

points in the United States. We will look at each in turn:

1. The carriage of the two YTZ-originating passengers who remained with 

the aircraft did not constitute cabotage. Rather, their movements (YTZ-TEBBOS-YYZ) constituted a single (as to each individual) continuous international 

journey originating and terminating in Canada with two stopovers in the United 

States (one in TEB and one in BOS). Since Cameron flew these passengers into 

the U.S. from Canada, it could lawfully transport them to other U.S. points, 

 1 A single-entity charter is a charter in which the cost is borne directly by the charterer and not directly or 

indirectly by the individual passengers.

2 Our focus on the itinerary of each individual passenger, rather than the chartering entity as a whole, is not 

merely required by a strict reading of the statute. If the movement of individual passengers were ignored in 

favor of the single continuous international journey of the single-entity charterer, then foreign air carriers 

could easily circumvent statutory restrictions on cabotage by designating the points between which they

provided transportation within the United States as mere "stopovers" by the charterer. Such a result would 

eviscerate the statutory prohibition against cabotage.
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provided that there was no break in each passenger’s journey at any point prior to 

the terminal point.3

2. The carriage of the two TEB-originating passengers who terminated their 

journeys in BOS on January 16, 2011, constituted cabotage. Since their transport 

from TEB to BOS was solely between U.S. points aboard a foreign civil aircraft

for which the operator was compensated, their carriage constituted cabotage.

4

For purpose of its future operations, Cameron should take note that any passenger it 

enplanes at a point in the United States, regardless of the reason for the passenger’s 

journey (e.g., business or leisure), his or her country of citizenship, whether the passenger 

or another party (e.g., the employer of the passenger’s family member) paid for the 

transportation, or whether the transportation was arranged or paid for outside the United 

States, must be transported by Cameron to Canada5

Mitigation

as part of a single continuous 

international journey.

In mitigation Cameron states that it did not intentionally violate any law or regulation of 

the Department. Furthermore, Cameron asserts that it has been operating between 

Canada and the United States for almost twenty years and has not had any prior 

infractions or enforcement actions initiated by the Department of Transportation. 

Cameron states that it was cooperative in the Department’s investigation of this flight and 

that immediately upon receiving notice of this flight from the Department took steps to 

ensure future compliance with the applicable laws and regulations.

Decision

The Office of Aviation Enforcement and Proceedings (Enforcement Office) has carefully

considered all of the information provided by Cameron Air Service, Inc., but continues to 

believe that enforcement action is warranted. The Enforcement Office and Cameron

have reached a settlement of this matter in order to avoid litigation. Without admitting or 

denying the violations described above, Cameron Air Service, Inc., agrees to the issuance 

of this order to cease and desist from future violations of 49 U.S.C. §§ 41703 and 41712 

 3 We note that had a second foreign air carrier operated any of the U.S. legs of the operation, the second 

carrier would have engaged in unlawful cabotage service. We also note that these passengers could 

lawfully have terminated their journey at any of the points at which they stopped, rather than returning to 

Canada.

4 Other Canadian air carriers have been found to have engaged in cabotage under circumstances similar to 

those of the instant case, i.e., the carrier moved a number of passengers on journeys entirely between U.S. 

points pursuant to a single-entity charter that began and/or ended in Canada. See London Air Services, 

Limited, Violations of 49 U.S.C. §§ 41301 and 41712, Order 2003-1-9 (Jan. 6, 2003), I.M.P. Group 

Limited, d/b/a Execaire, Violations of 49 U.S.C. §§ 41703 and 41712 and 14 CFR Part 294, Order 2006-1-

17 (Jan. 23, 2006), and 926724 Ontario Limited, d/b/a President Air Charter, Violations of 49 U.S.C. 

§§ 41703 and 41712 and 14 CFR Parts 205 and 294, Order 2010-10-9 (Oct. 18, 2010).

5 The passengers may also be transported to a third country, to the extent that such transportation is 

permissible under the United States-Canada bilateral aviation agreement then in effect.
4

and 14 CFR Part 294 and to the assessment of $20,000 (US) in compromise of potential 

civil penalties otherwise due and payable pursuant to 49 U.S.C. § 46301.

This compromise assessment is appropriate considering the nature and extent of the 

violations described herein and serves the public interest. It represents a strong deterrent 

against future noncompliance with the Department’s cabotage requirements by Cameron 

and other non-U.S. air carriers.

This order is issued under the authority in 49 CFR 1.57a and 14 CFR 385.15.

ACCORDINGLY,

1. Based on the above information, we approve this settlement and the provisions of this 

order as being in the public interest;

2. We find that Cameron Air Service, Inc., violated 49 U.S.C. § 41703 by carrying, for 

hire, two passengers between two points wholly within the United States;

3. We find that by engaging in the conduct described in paragraph 2 above, Cameron 

Air Service, Inc., also violated 14 CFR 294.81;

4. We find that by engaging in the conduct described in paragraphs 2 and 3 above, 

Cameron Air Service, Inc., engaged in unfair and deceptive trade practices and unfair 

methods of competition in violation of 49 U.S.C. § 41712

5. We order Cameron Air Service, Inc., and all other entities owned or controlled by, or 

under common ownership and control with Cameron Air Service, Inc., their 

successors, affiliates, and assigns, to cease and desist from further similar violations 

of 49 U.S.C. §§ 41703 and 41712 and 14 CFR 294.81. Failure to comply with this 

cease and desist provision shall subject Cameron Air Service, Inc., and its successors 

and assignees to further enforcement action;

6. We assess Cameron Air Service, Inc., $20,000 (US) in compromise of civil penalties 

that might otherwise be assessed for the violations described above. Of this total 

amount, $10,000 will become due and payable in four equal installments of $2,500. 

The first installment of $2,500 is due and payable within 30 days of the issuance date 

of this order, the second installment of $2,500 is due and payable within 60 days of 

the issuance date of this order, the third installment of $2,500 is due and payable 

within 90 days of the issuance date of this order, and the fourth and final installment 

of $2,500 is due and payable within 120 days of the issuance date of this order. The 

remaining $10,000 shall become due and payable if Cameron Air Service, Inc.,

violates this order’s cease and desist provisions or the payment provisions within one 

year following the date of the issuance of this order, in which case the entire unpaid 

portion of the civil penalty shall become due and payable immediately; and
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7. We order Cameron Air Service, Inc., to remit the payment assessed in paragraph 6

above by wire transfer through the Federal Reserve Communications System, 

commonly known as "Fed Wire," to the account of the U.S. Treasury in accordance 

with the instructions contained in the attachment to this order. Failure to pay the 

penalty as ordered shall subject Cameron Air Service, Inc., to the assessment of 

interest, penalty, and collection charges under the Debt Collection Act, and to 

possible additional enforcement action for failure to comply with this order.

This order will become a final order of the Department 10 days after its service date 

unless a timely petition for review is filed or the Department takes review on its own 

motion.

BY:

ROSALIND A. KNAPP

Deputy General Counsel

(SEAL)

An electronic version of this document is available at 

www.regulations.gov